AMZN Update

It's time to decide what to do with positions like AMZN, trade around them, hedge them or just let them be. The last AMZN short position is working, but this is a stock going through a lot of volatility, if we were in a different area of the market I'd be inclined to trade around it. As it sits now I might be inclined to hedge it with a Call, here's why and this may open up an opportunity for anyone who might want in on the AMZN short trade, but wants a better entry with less risk.

 The last short on a head fake move amidst a lot of volatility was the right call, not an east call, but the right one, however I suspect we have some recent support that has built in short term which is likely part of the continued volatility at the white arrow.

 Here on a 15 min intraday chart you can see the area at the red trendline and the failure to make a lower low so far, smells like a correction to the upside, which is good if you want to look at AMZN as a short, but for position management and where we are in the market, it's a more difficult decision as trading around and trying to get too fancy cost me about 170 points in AAPL, a position that was already set up short, but because of a correction it was closed to try to enter at a better price, sometimes you get too fancy at exactly the wrong time.

 On a 30 min chart we have the negative divergence/head fake / entry area and a more recent positive divergence at support and the failure to make a lower low, I'd say a correction is coming here.

 At some point you have to loosen up on the reigns and let something objective like the Trend Channel take over and as it is, it's set for the action for this year, but volatility has increased a lot, the 2 day channel below looks a lot better, but riskier in a sense.

It's just turned to a short and has a wide enough stop I'd think to accomodate the volatility, I think if anything I would not exit the equity short, but use a call option to hedge the upside risk that I think is likely as part of the continued increase in volatility, not so much a change in the new trend.

Just something to think about whether you are in or not.